Launching A Website Or Commencing Advertising By Itself Is Not Sufficient Use In Commerce Of A Service Mark
Trademark owners often mistakenly assume that they merely have to put up a website or commence advertising to gain trademark rights in a service mark used on the website or in the advertising. By its March 2015 decision in Couture v. Playdom, Inc., the Federal Circuit Court of Appeals confirmed that such activity, without actually providing the services offering on the website or in the advertising, does not constitute sufficient trademark use.
In Couture, the Federal Circuit tackled the question of “whether the offering of a service, without the actual provision of a service, is sufficient to constitute use in commerce under Lanham Act§ 45, 15 U.S.C. § 1127.” Section 45 provides that a service mark is used in commerce “when it is used or displayed in the sale or advertising of services and the services are rendered in commerce, or the services are rendered in more than one State” (emphasis added). Citing decisions in the Second, Fourth and Eighth Circuits, the Federal Circuit held that Section 45 requires the actual rendering of services for there to be use in commerce.
The Couture decision highlights what can happen when a trademark owner does not do sufficient strategic planning. The trademark owner in Couture filed its application in May 2008 and registration was granted in January 2009. The trademark owner’s application was under Section 1(a) of the Trademark Act (i.e. based on actual use) even though the trademark owner had only placed the service mark at issue on a website that was “under construction” at the time of the application and registration. The trademark owner did not actually begin rendering services until March 2010. Under such circumstances, the trademark owner could have better protected his trademark rights by filing an application under Section 1(b) of the Trademark Act based on an “intent to use.”
Here’s an interesting post written by our associate attorney Ashley Franco about the recent Volkswagen scandal:
In 1973 Volkswagen (VW) settled with the Justice Department for $120,000 for cheating on its emissions test. Now more than forty years later, Volkswagen has again been caught cheating on its emissions test. Apparently VW installed software in its diesel vehicles which was specifically designed to pass emissions tests without actually being in compliance.
So what exactly is the harm done by Volkswagen? The Environmental Protection Agency states that the cheating software allows specific VW models to pass emissions test while actually emitting more than 40 times the legal limit. This means that the VW vehicles with the cheating software emit 40 times more that the amount of harmful fumes allowed. VW has admitted to creating the software specifically to lower the emissions reported by its vehicles during inspections. Cheating on its emissions tests has already resulted in a dramatic plunge in VW’s stock price. VW also lost its CEO and is facing billions of dollars in fines.
What everyone should learn from VW’s mistake is that when dealing with state and federal laws, you don’t want to swindle your way into compliance. It is important to consult with a lawyer to make sure that your business practices are in conformity with applicable laws and regulations. Even if you are not intentionally breaking the law, you may still be inadvertently in violation of a law and/or regulation, thereby putting you at risk of civil and criminal liability.
In VW’s case, under the Clean Air Act (the federal law designed to control air pollution), each violation may result in up to a $37,500 fine. VW is suspected of having more than 400,000 violations. A $37,500 fine multiplied by 400,000 violations results in over $15 billion in potential fines being faced by VW simply by cheating on its emissions tests.
This isn’t the first time a car company has been fined by US regulators. Last year General Motors (GM) was facing civil and criminal penalties for installing faulty ignition switches in over 2.6 million vehicles. However, GM reached a $900 million settlement with US officials. The main difference between GM’s liability and VW’s potential liability is that VW’s cheating devices did not cause any deaths, whereas GM’s faulty ignition switches did. That doesn’t mean that there won’t be suits filed. A recent survey by Big Law Business of the nation’s court dockets identified that twenty federal lawsuits have already been filed against VW based on the diesel scandal. As of the date of this posting there have not been any settlements by VW so it is still too early to predict how the VW scandal will resolve. However, companies certainly can learn from the VW scandal that it simply does not pay to cheat on compliance with federal and state laws and regulations.
While The Scope Of Copyright Protection Is Broad, Two Recent Cases Involving Yoga Positions And Recipes Show That There Are Limits
In a recent post in this space, we commented on several cases that illustrated that the scope of copyright protection is extremely broad (see here: https://affinitylaw.wordpress.com/2015/09/30/three-cheers-for-the-wood-flooring-recent-cases-confirm-copyright-protection-for-cheerleader-uniforms-and-wood-flooring-pattern). Two recent cases show that while copyright protection is broad, there still are limits:
Bikram’s Yoga College of India, L.P. v. Evolution Yoga, LLC: In this well-publicized case, the issue was whether a sequence of 26 yoga positions and two breathing exercises practiced in a specific order, called the “Sequence” and developed by Bikram Choudhury (a seminal figure in making yoga so popular in the United States and throughout the world and the creator of Bikram Yoga, sometimes called “hot yoga”), could qualify for copyright protection. In 1979, Choudhury published the book “Bikram’s Beginning Yoga Class” that includes descriptions and photographs of the Sequence in practice. In 2002, Choudhury also registered a copyright on the “compilation of exercises” contained in his book. In 2009, the defendants founded their own yoga studio and offered “hot yoga” classes that included the Sequence. Choudhury sued for copyright infringement claiming that the defendants infringed on his copyrighted works by offering yoga classes featuring the Sequence.
On October 8, 2015, the Ninth Circuit Court of Appeals held that the Sequence falls squarely within the exclusion detailed in Section 102(b) of the Copyright Act, which excludes from copyright protection “any idea, procedure, process, system, method of operation, concept, principle, or discovery, regardless of the form in which it is described, explained, illustrated or embedded in such work.” The Ninth Circuit found the Sequence was a process for obtaining physical and emotional fitness and was, therefore, not copyrightable.
Tomaydo-Tomahhdo, LLC v. Vozary: The issue in the Tomaydo-Tomahhdo case was whether a book of recipes could qualify for copyright protection. The plaintiff was a restaurateur who created and ran a successful restaurant and delivery catering business. In 2012, the plaintiff assembled a book of recipes that had been developed for the restaurant. The defendant was a former partner in the plaintiff’s business. He copied the plaintiff’s recipes and used them in a competing catering business, and the plaintiff sued him for copyright infringement.
On October 20, 2015, the Sixth Circuit Court of Appeals held there was no copyright infringement because neither the recipes themselves nor the book which compiled the recipes were entitled to copyright protection. In so holding, the Sixth Circuit explained that the recipes themselves are not covered by copyright because they are simply listings of facts (i.e. the ingredients) and functional instructions how to assemble the ingredients. Likewise, the Sixth Circuit held that the recipe book did not have any originality (such as original commentary, pictures, etc. by the author) that qualified for copyright protection separate from the recipes themselves.
In both the Bikram Yoga case and the Tomaydo-Tomahhdo case, the parties claiming copyright protection may have been able to take steps to protect their intellectual property other than merely claiming copyrights in the materials addressed by those cases. As always, we highly recommend that businesses consult with experienced intellectual property counsel to assess what IP protection may be available to the business.